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Notified · 8 May 2026 · GSR 342(E)

Industrial Relations
(Central) Rules, 2026 — The Deep Dive

Fifty rules, thirteen chapters, sixteen forms. The procedural backbone of how India will run its industrial relations from now on — replacing the Industrial Disputes (Central) Rules, 1957 and the Industrial Employment (Standing Orders) Central Rules, 1946. Read it once. Compare yourself. We have already done the work for you.

Gazette
GSR 342(E)
Notified
8 May 2026
Effective
From publication
Supersedes
ID Rules 1957 · Standing Orders Rules 1946
Reading time
~22 minutes
13
Chapters
50
Rules
16
Forms
300+
Worker Trigger
15 days
Re-Skilling Fund
Editor's Note · Why This Matters

Sixty-nine years of Industrial Disputes rule-book — replaced in a single gazette.

The Industrial Disputes (Central) Rules, 1957 governed how India handled strikes, lay-offs, retrenchments, lockouts, conciliation and tribunal proceedings for nearly seven decades. The Industrial Employment (Standing Orders) Central Rules, 1946 governed workplace discipline for eighty years. Both are gone. As of 8 May 2026, what replaces them is leaner, digitised, and built around the assumption that the system works through portals, not paper.

Most of the substantive provisions — the 300-worker threshold for prior approval, fixed-term employment, the negotiating union/council architecture, the Re-Skilling Fund — were already written into the IR Code, 2020. What was missing for nearly six years was the plumbing: which form to fill, which officer receives it, what the timeline is, what happens on appeal. That plumbing arrived on 8 May. This page walks through it.

Use the audience filter below — CFOs see the cost lens, HR sees the process lens, employees and the public see the rights lens, and "Plain English" strips out the jargon entirely. Every rule keeps its gazette reference at the bottom for verification.

Editorial team · The Labour Codes
Read as:
Chapter I · Rules 1–4

Preliminary & Definitions

The opening chapter does the housekeeping: what these rules are called, when they take effect, what "electronically" means, and — crucially — who counts as the "employer" for ministerial undertakings and railways. It also lays down the format for any settlement memorandum signed between an employer and workers.

Rule 1 All
These rules are now law — from the day they were gazetted.
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In one line

The Industrial Relations (Central) Rules, 2026 take effect on the date of their publication in the Official Gazette — that is, 8 May 2026. There is no transition period built into the rules themselves.

They shall come into force on the date of their publication in the Official Gazette.
Worth knowingThis is unusual. Many notifications come with a future commencement date to let stakeholders prepare. Here, the framework is live from the day of notification — the gazette IS the start gun.
Source: IR (Central) Rules, 2026 · Rule 1(2) · GSR 342(E)
Rule 2 HR Plain
"Electronically" is now the default — email, portal upload, or digital payment all count.
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What changed

The rules define "electronically" to mean any information submitted by email, uploading on the official portal, or digital payment in any mode. This single definition runs throughout the rules — almost every notice, application, and report can now be delivered without paper.

For HR
You can stop maintaining hard-copy registers as the only form. Email and portal submissions are valid by definition. Update your SOP for notice service to default to electronic.
In Plain English
If your boss sends you an email about retrenchment, lay-off, or change of conditions, that's a legally valid notice. You can't say "but I didn't receive a letter."
Source: IR (Central) Rules, 2026 · Rule 2(1)(b)
Rule 3 HR
Who is "the employer" — clarified for ministries, railways, and UTs.
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What changed

For Union Territories without legislatures, references to the Central Government in the Code mean the Administrator of that UT. For ministries and departments, the officer-in-charge of the establishment is the employer. For railways, three categories:

  • Zonal Railway establishments — General Manager is the employer (regular staff, not casual labour)
  • Independent railway establishments — Officer-in-charge of the establishment
  • Casual labour — District Officer-in-charge, Divisional Personnel Officer, or Personnel Officer (whichever applies)
Source: IR (Central) Rules, 2026 · Rule 3
Rule 4 HR You
Settlement Memorandum — Form I prescribed; six valid signatories on the worker side.
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What changed

Any written settlement between employer and workers — whether reached during conciliation or directly — must be in Form I. On the employer side, it can be signed by the employer or an authorised agent (or, for incorporated companies, by an agent, manager, or principal officer). On the workers' side, it can be signed by any one of:

  • President · Vice-President · Secretary (incl. General Secretary) · Joint Secretary of the trade union
  • Any other office-bearer authorised in writing by the President and Secretary
  • Five worker representatives duly authorised at a meeting held for the purpose
For HR
If the settlement is reached during conciliation, the conciliation officer sends a copy to the Centre. If reached outside conciliation, the parties must jointly send a copy to the Deputy CLC (Central) and the conciliation officer — electronically or by speed post.
For You
You can settle informally without going through conciliation, but the settlement still has to be filed. The conciliation officer's signature is NOT required if you settle outside conciliation.
Form I
Source: IR (Central) Rules, 2026 · Rule 4
Chapter II · Rules 5–8

Bi-Partite Forums — Works Committee & Grievance Redressal

Two committees that every covered establishment must run. The Works Committee is for amity and consultation. The Grievance Redressal Committee is mandatory in every establishment with 20+ workers. Composition, term, dispute escalation — all now codified.

Rule 5 HR Key
Works Committee — max 20 members, equal representation, three-year term.
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The TL;DRWhere the Centre directs, employer must constitute a Works Committee. Worker representatives must equal or exceed employer representatives. Total cannot exceed 20. Women must be represented in proportion to their share of the workforce. Term: three years. Meets at least once every three months.
Composition rules
  • Total members: shall not exceed twenty (20)
  • Worker representatives: shall not be less than employer representatives
  • Women representation: proportional to women workers' share of total workforce
  • Where there is a negotiating union (s.14(2)/(3) of the Code) — that union nominates worker reps
  • Where there is a negotiating council (s.14(4)) — each constituent union nominates in proportion to its membership
  • No recognised union — workers elect their representatives among themselves; employer may use an electronic platform for the election
Term, meetings, dissolution
  • Term: three years; co-options allowed for the unfilled period of a casual vacancy
  • Failure to attend three consecutive meetings without leave = forfeiture of membership
  • Meetings: at least once every three months, ordinarily during working hours; worker reps deemed on duty during meetings
  • Central Government can dissolve the Committee if it's not constituted properly, or if 2/3 of worker reps fail to attend three consecutive meetings without justification, or if it has otherwise ceased to function
For HR
Constitute the Committee within the timeline once you receive an order under s.3(1) of the Code. The employer also bears the cost — must provide a meeting place and facilities. Submit Committee details as part of the unified annual return under the OSH Code.
For CFO
Cost is real but bounded — meeting facilities, paid time for worker reps during meetings (deemed on-duty), and administrative staff time. Budget as a fixed quarterly cost.
Source: IR (Central) Rules, 2026 · Rule 5 · references s.3(1), s.14 of the IR Code
Rule 6 HR You Key
Grievance Redressal Committee — mandatory at 20+ workers; max 10 members; equal split.
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20workers
Trigger threshold
10max
Total members
3years
Term of office
30days
To resolve grievance
What changed

Every establishment with 20 or more workers must have a Grievance Redressal Committee. Equal number of employer and worker representatives. Total members capped at 10. Worker reps are nominated by the negotiating union/council if one exists; otherwise workers choose among themselves (electronic election permitted). Women must have representation proportional to their share of the workforce. Term: three years. Disputes about who represents workers go to the Regional Labour Commissioner (Central) — whose decision is final.

For HR
If you have 20+ workers, this committee is non-negotiable. If you don't already have one, constitute it now. Maintain a register of grievances filed and outcomes. Heads of major departments are the recommended employer reps.
For You
You have a one-stop forum for any work-related grievance. The committee MUST resolve it within 30 days. If they don't, or if you're unhappy with the decision, you have 60 days to appeal to the Conciliation Officer.
Source: IR (Central) Rules, 2026 · Rule 6 · references s.4(6) of the IR Code
Rule 7 You Plain
How to file a grievance — electronically or otherwise; one-year limitation period.
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In simple terms

An aggrieved worker can file a grievance with the Grievance Committee — by email, online portal, or physically. The application must include:

  • Name, designation, worker code/token number
  • Department, length of service, category
  • Address for correspondence and contact number
  • Details of the grievance and the relief sought

Time limit: the application must be filed within one year from the date the cause of action arose. After one year, the Committee may decline to entertain it.

Pro tip"Cause of action" = the date of the act you are aggrieved about (e.g., the day your transfer order was issued, or the day your wages were short-paid). Don't wait — the clock starts running immediately.
Source: IR (Central) Rules, 2026 · Rule 7
Rule 8 You
If the Grievance Committee fails — sixty days to appeal to the Conciliation Officer.
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If the Grievance Committee does not resolve your matter within 30 days — or you are aggrieved by its decision — you have 60 days from that point to file an application with the Conciliation Officer. Routes:

  • Online — Ministry of Labour and Employment's designated portal
  • By speed post
  • In person

If filed manually (post or in person), the Conciliation Officer must digitise it and enter it into the online mechanism, with intimation to your trade union and you.

ImportantThe application is filed through your Trade Union if you are a member. If you are not a member of any union, see Rule 41 — another worker or trade union office-bearer can be authorised to represent you.
Source: IR (Central) Rules, 2026 · Rule 8 · references s.4(6) of the Code
Chapter III · Rule 9

Trade Unions — Recognition by Secret Ballot

A single but very long rule. It defines what unions can negotiate, the criteria for sole-negotiating-union status (30%+ if alone, 51%+ if multiple), and the entire secret-ballot verification process conducted by an independent verification officer appointed by the Centre.

Rule 9 HR You Key
Negotiating union/council — secret ballot, verification officer, ten matters specified for negotiation.
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The TL;DROne union with 30%+ membership = automatic sole negotiating union. Multiple unions = 51%+ wins sole status. Otherwise, a council is formed of unions with at least 20% support. Verification is done by a Centre-appointed officer through secret ballot, possibly electronic. Employer pays for the entire verification exercise.
The ten negotiable matters (as specified)
  1. Classification of grades and categories of workers
  2. Orders passed under standing orders
  3. Wages — wage period, DA, bonus, increments, customary concessions, allowances
  4. Hours of work, rest days, weekly working days, rest intervals, shifts
  5. Leave with wages and holidays
  6. Promotion, transfer policy, disciplinary procedures
  7. Quarter allotment policy
  8. Safety, health and working conditions standards
  9. Other terms of service not covered above
  10. Anything else mutually agreed between employer and union/council
The 30% / 51% / 20% rule
Single union scenario
30%+ membership in the establishment → automatic recognition as sole negotiating union. Employer must recognise.
Multiple unions scenario
Sole negotiating union requires 51%+ membership. If no union crosses 51%, a negotiating council is formed from unions with 20%+ membership, with seats in proportion to membership.
Secret ballot verification

The Centre appoints a verification officer who must have no interest in any union being verified. The officer:

  • Convenes a meeting of all union representatives 60 days before actual voting to decide voter list, date/time/mode/place of voting, counting, etc.
  • Allocates symbols to each union
  • Has the final call where consensus is not reached
  • May supervise an electronic ballot if the employer deploys one

The voter list is prepared by the employer based on the muster roll on the date of reckoning, finalised by the verification officer, and displayed at the main entrance and on the establishment website (if any) within two days of finalisation.

For CFO
Employer bears all expenses of verification — verification officer's costs, ballot infrastructure, electronic platform if used, displaced labour time. Process recurs every term — start three months before the existing recognition period expires.
For HR
Process must commence three months before the expiry of the existing union/council recognition. Maintain accurate muster rolls — they become the voter list. Any error here will be challenged.
Source: IR (Central) Rules, 2026 · Rule 9 · references s.14 of the Code
Chapter IV · Rules 10–18

Standing Orders — The Workplace Rulebook

Where Model Standing Orders apply, what attaches to draft standing orders, how appeals work, where the certified text must be displayed, and how the certifying officer maintains a register. This is the chapter that operationalises Section 30 of the IR Code — the 300-worker threshold for mandatory certification.

Rule 10 HR Key
Model Standing Orders — separate sets for mining, manufacturing, and services.
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The Model Standing Orders for the purposes of the Code are notified separately for industrial establishments in:

  • Mining sector
  • Manufacturing sector
  • Services sector

An employer can adopt the relevant Model Standing Orders as-is (deemed certification), or draft their own and submit for certification.

Confidence flagThe exact text of the Model Standing Orders — covering classification, attendance, leave, suspension, misconduct definitions — runs to many pages and is part of the schedule attached to the rules. We are preparing a separate page just for the Model Standing Orders.
Source: IR (Central) Rules, 2026 · Rule 10
Rule 11 HR
Where there is no trade union — workers elect representatives for standing-orders purposes.
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If no trade union exists, the workers must elect representatives among themselves for any standing-orders-related notice or proceeding. The employer may deploy an electronic platform for this election.

Source: IR (Central) Rules, 2026 · Rule 11
Rules 12–13 HR
Authentication of certified standing orders, and the statement that must accompany the draft.
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The certified standing orders (and any modifications) must be authenticated by the certifying officer. Any draft standing order submitted for certification must be accompanied by:

  • Tabular statement showing existing provisions vs proposed modifications
  • Reasons for the modifications
  • Particulars of registered trade unions in the establishment
  • Signatures of authorised representatives
Source: IR (Central) Rules, 2026 · Rules 12–13
Rule 14 HR
Group employers — joint draft standing orders permitted for similar establishments.
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Where a group of employers run similar industrial establishments, they may jointly submit a single draft standing order for all of them — subject to conditions specified in the rule. Useful for industry associations and chains.

Source: IR (Central) Rules, 2026 · Rule 14
Rules 15–16 HR You
Appeals against certification — and how the final order is served.
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An employer, trade union, negotiating union/council, or representative body of workers may file an appeal against the certifying officer's order. The appeal:

  • Goes to the appellate authority
  • Must be served with a copy on each respondent
  • The appellate authority may call for evidence at any stage

The order on appeal must be served within 3 days of disposal. The certified text must be:

  • Maintained by the employer in Hindi, English and the local language
  • Displayed legibly on a special board at the entrance through which the majority of workers enter
  • Optionally posted on the establishment's website/portal
Source: IR (Central) Rules, 2026 · Rules 15–16
Rules 17–18 HR Plain
Register of standing orders — Form III; modifications must be applied for in tabular form.
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The certifying officer maintains an electronic register in Form III of all certified or deemed-certified standing orders, containing:

  • Unique number of each standing order
  • Name and nature of the industrial establishment
  • Date of certification, deemed certification, or adoption of Model Standing Orders
  • Areas of operation

Anyone can request a copy of any certified standing order — at ₹2 per page, payable electronically. To modify existing standing orders, file an application electronically/by post/in person, with a tabular statement showing existing vs proposed provisions, reasons, and trade-union particulars.

Form III
Source: IR (Central) Rules, 2026 · Rules 17–18
Chapter V · Rule 19

Notice of Change — Form IV

Changing service conditions on matters listed in the Third Schedule of the Code requires prior notice to affected workers. The form, mode, and method of display are now prescribed.

Rule 19 HR You
Notice for change in service conditions — Form IV; electronic, post, or in-person service.
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Any employer wanting to change service conditions on matters listed in the Third Schedule to the Code (typical examples: hours of work, leave, wage rates, allowances, classification) must:

  • Give notice in Form IV to the affected workers
  • Serve electronically, by speed post, or in person
  • Display conspicuously on the notice board (physical or electronic) at the main entrance
  • Upload on the establishment's designated portal, if one exists
  • Where there is a registered trade union, negotiating union, or council — also serve a copy on the secretary of each
Form IV
Source: IR (Central) Rules, 2026 · Rule 19 · references the Third Schedule of the Code
Chapter VI · Rules 20–22

Voluntary Arbitration

A parallel track to formal adjudication. Parties can refer a dispute to arbitration by joint agreement; once the agreement is filed, the Government issues a notification.

Rules 20–22 HR You
Arbitration agreement — prescribed format; signatures, notification, and worker representation.
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Employer and workers may agree to refer a dispute to arbitration in the prescribed form. Once filed, and the Centre is satisfied a substantial number on each side support the reference, it issues a notification. Where there is no trade union, workers must elect representatives to the arbitration the same way as for standing-orders purposes.

Source: IR (Central) Rules, 2026 · Rules 20–22
Chapter VII · Rules 23–24

Conciliation & Recovery of Dues

How conciliation proceedings run, what the conciliation officer does with the report, and how a worker recovers money due under a settlement, award, or under Chapter IX/X of the Code. Forms VII–X cover recovery applications.

Rule 23 HR You
Conciliation proceedings — affidavit-based, portal-uploaded, 90 days for tribunal application.
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When a conciliation officer receives a notice of strike, lock-out, or a dispute reference:

  • All evidence (other than documentary) must be filed by affidavit
  • The conciliation officer's report and any settlement memorandum must be uploaded on the Ministry of Labour and Employment portal
  • If the dispute is not settled, the concerned party may apply to the Tribunal in Form II — electronically or by speed post — within 90 days from the date of the report
Form II
Source: IR (Central) Rules, 2026 · Rule 23
Rule 24 You Plain
Recovery of dues — four forms (VII–X), Tribunal must decide within three months.
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If money is owed to a worker (or group of workers) under a settlement, an award, or under Chapter IX/X of the Code:

  • Form VII — recovery application by the worker / group
  • Form VIII — recovery application by an authorised person on the worker's behalf, or by the heir/assignee where the worker has died
  • Form IX — for a benefit that needs to be computed in money terms (worker applies to the Tribunal)
  • Form X — same as Form IX, but where the worker has died (heir/assignee applies)

Where a benefit needs to be valued in money, the Tribunal must decide within 3 months from the date of the application.

Form VII
Form VIII
Form IX
Form X
Source: IR (Central) Rules, 2026 · Rule 24 · references Chapters IX, X of the Code
Chapter VIII · Rules 25–26

Strikes & Lock-outs

The forms, signatories, addressees, and timelines for strike and lock-out notices. Form XI for strikes, Form XII for lock-outs. Five-day rule for the employer to forward any received notice.

Rule 25 You HR
Strike notice — Form XI; signed by union secretary or five elected workers.
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A strike notice (under s.62(1) of the Code) must be:

  • Given to the employer in Form XI
  • Signed by the secretary of the registered trade union — or by five elected worker representatives if there is no registered union
  • Endorsed (electronically or by speed post) to the conciliation officer, Chief Labour Commissioner (Central), and Secretary, Ministry of Labour and Employment

The date of receipt of the notice = the operative date for clause (a) of s.62(1).

If the employer receives any strike notice, they must intimate it electronically to the conciliation officer and CLC (Central) within 5 days.

Form XI
Source: IR (Central) Rules, 2026 · Rule 25 · references s.62 of the Code
Rule 26 HR
Lock-out notice — Form XII; display at main entrance + portal upload.
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A lock-out notice (s.62(2)) must be:

  • Given by the employer in Form XII to the secretary of every registered trade union — by speed post or electronically
  • Endorsed electronically to the conciliation officer, CLC (Central), and the Secretary, Ministry of Labour and Employment
  • Displayed conspicuously on the notice board (or electronic board) at the main entrance
  • Posted on the establishment's portal, if any

If the employer issues a lock-out notice to any employed person, they must inform the conciliation officer and CLC (Central) electronically within 5 days.

Form XII
Source: IR (Central) Rules, 2026 · Rule 26
Chapter IX · Rules 27–29

Retrenchment & Closure — General

For establishments where Chapter IX of the Code applies (general retrenchment provisions, no prior approval needed). Notice procedure, re-employment seniority, and 60-day closure notice.

Rule 27 HR You Key
Retrenchment notice — Form XIII; one-month's wages OR one-month's notice; three-day intimation rule.
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The TL;DRTo retrench any worker who has been in continuous service for at least one year, the employer must give prior notice in Form XIII to the Central Government and the Deputy CLC (Central). The intimation timing depends on whether the employer is giving notice or paying wages in lieu — but in every case it must be within three days of the triggering act.
The three-day rule, three flavours
  1. Where prior notice is given (under s.70(a)): Form XIII intimation within 3 days of serving the notice on the worker
  2. Where one month's wages are paid in lieu: Form XIII intimation within 3 days of payment
  3. Retrenchment by agreement specifying a termination date: notice must reach the Centre and Deputy CLC (Central) at least one month before that date — but if the agreed date is within 30 days of the agreement, intimation is within 3 days of the agreement
Form XIII
For HR
Build a 3-day clock into your retrenchment SOP. The trigger is whichever of (notice / payment / agreement) happens — measure backwards from there. Send via email or speed post; both are accepted.
For CFO
Total retrenchment cost (Chapter IX route, no prior approval) per worker = 1 month's notice OR 1 month's wages in lieu + 15 days' average pay per completed year of continuous service (s.70(b) of the Code) + 15 days' last-drawn wages to the Re-Skilling Fund (Rule 37).
Source: IR (Central) Rules, 2026 · Rule 27 · references s.70 of the Code
Rule 28 HR You
Re-employment of retrenched workers — seniority list, 15-day vacancy notice, one-year window.
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The mechanics
  • Employer prepares a seniority list of workers in the category from which retrenchment is contemplated, posted on the notice board at least 7 days before the actual date of retrenchment
  • If a vacancy arises within one year of retrenchment, retrenched workers (who are Indian citizens and have indicated willingness) get preference based on seniority
  • Vacancies must be displayed at least 15 days before they are to be filled
  • Information of vacancies is sent by speed post or email to retrenched workers eligible to be considered
  • Vacancies of less than one month's duration: no obligation to inform retrenched workers
  • If a retrenched worker fails to respond without sufficient cause shown in writing, employer is no longer obligated to inform that worker of subsequent vacancies
For You
Keep your contact details (latest address, email) updated with the employer at the time of retrenchment — that's the address the employer will use for vacancy intimation. Failure to respond once without good reason can disqualify you from future intimations.
Source: IR (Central) Rules, 2026 · Rule 28
Rule 29 HR
Closure (general) — Form XIII; sixty days' prior notice.
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To close down an industrial establishment under Chapter IX:

  • Notice in Form XIII, at least 60 days before the intended closure date
  • Sent to the Central Government with a copy to the Deputy CLC (Central) — by email or speed post
  • A copy must also go to registered trade unions / authorised worker representatives in the establishment
Form XIII
Source: IR (Central) Rules, 2026 · Rule 29
Chapter X · Rules 30–36

The 300+ Rule — Prior Approval Mechanism

For establishments to which Chapter X of the Code applies — generally those with 300+ workers on average per working day in the preceding 12 months. These cannot lay-off, retrench, or close without prior permission of the Central Government. Form XIV is the universal application; review timelines are tight.

Rule 30 HR Key
Application for intended lay-off — Form XIV; copy to worker simultaneously.
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An employer covered by Chapter X must apply to the Central Government in Form XIV seeking permission for lay-off, stating reasons clearly. A copy must be served simultaneously to the affected worker — electronically, in person, or by speed post. The application must also be displayed on the notice board (or electronic board) at the main entrance.

Form XIV
Source: IR (Central) Rules, 2026 · Rule 30
Rule 31 HR
Mining lay-off continuation — special 30-day rule.
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For mining establishments: where workers (other than badli or casual workers) are laid off because of fire, flood, excess inflammable gas, or explosion, the employer must apply in Form XIV within 30 days of the commencement of lay-off to continue it. The application must specify number of days, number of workers, total workforce, date of lay-off, and reasons for continuation.

Source: IR (Central) Rules, 2026 · Rule 31
Rule 32 HR You
Review of lay-off order — 30-day window, 2-month disposal.
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The Central Government may review its own lay-off order — on its own motion, or on application by the employer or any worker. Either side has 30 days from the date of the order to file a review application. The Government must dispose of the application within 2 months after providing both sides an opportunity to be heard. If the Government acts suo motu, it must take steps within one month of the original order.

Source: IR (Central) Rules, 2026 · Rule 32
Rules 33–34 HR
Application for intended retrenchment + review — same Form XIV mechanism.
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Same architecture as lay-off: Form XIV electronic application, copy served on workers simultaneously, review window of 30 days, disposal within 2 months.

Form XIV
Source: IR (Central) Rules, 2026 · Rules 33–34
Rules 35–36 HR Key
Closure under Chapter X — 90 days' prior permission required.
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Closure under Chapter X is the slowest of the three. Employer must apply in Form XIV at least 90 days before the intended closure date — electronically — to the Central Government, with a copy to worker representatives. Review architecture is identical: 30-day window, 2-month disposal.

Form XIV
For CFO
Plan the timeline carefully. From the date of board decision to actual closure, build in: 90 days notice + worst-case 2-month review + buffer. Total: typically 5–6 months from decision to lawful closure for 300+ establishments.
For HR
The same Form XIV does triple duty — lay-off, retrenchment, and closure. Different mode of dispatch (electronic only for closure under Ch. X). Different timelines. The form's section headers identify which use you are invoking.
Source: IR (Central) Rules, 2026 · Rules 35–36
Chapter XI · Rule 37

The Worker Re-Skilling Fund

A new financial obligation that did not exist under the Industrial Disputes Act. Every employer who retrenches a worker must credit fifteen days of that worker's last-drawn wages to the Re-Skilling Fund within ten days. The fund disburses to the worker within forty-five days of retrenchment.

Rule 37 CFO You Key New Cost
Re-Skilling Fund — 15 days' last-drawn wages, 10-day deposit, 45-day disbursement.
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15days
Last-drawn wages
10days
Employer to deposit
45days
CLC to disburse to worker
100%
Direct to worker's bank a/c
The mechanics
  1. On retrenchment of any worker, the employer must electronically transfer 15 days of last-drawn wages to the Fund — within 10 days of retrenchment
  2. The fund is held by the Chief Labour Commissioner (Central) — or the Deputy CLC / Regional LC / Assistant LC, as the case may be
  3. The CLC office electronically credits the amount to the retrenched worker's bank account within 45 days of retrenchment, for the worker to use for re-skilling
  4. Employer must also submit a list of retrenched workers — names, 15-day wages amount, bank account details — to the relevant CLC office
[The fund] shall be transferred… electronically to each of the retrenched worker account within forty-five days of retrenchment to enable them to utilise that amount for his re-skilling.
For CFO · The Real Number
Total per-worker retrenchment cost (Chapter IX route): 1 month notice or pay-in-lieu + 15 days × years of service (s.70(b)) + 15 days last-drawn wages (Re-Skilling Fund). For a worker with 5 years of service earning ₹50,000 last-drawn: ~₹50,000 (notice/in-lieu) + ~₹1,25,000 (compensation) + ~₹25,000 (Re-Skilling Fund) = ~₹2,00,000 per worker. Plus statutory gratuity if applicable.
For You
If you are retrenched, the law now requires money to be set aside specifically for your re-skilling — over and above your retrenchment compensation. It comes directly to your bank account. No application required.
In Plain English
This is brand-new. Under the old Industrial Disputes Act, the only retrenchment money was the compensation paid to you directly. Now there is a separate top-up of 15 days' wages — collected by the Government from your employer and paid into your bank account within 45 days, specifically so you can retrain.
Confidence flagThe rule is silent on what counts as "wages" for this purpose. The Code's wage definition (s.2(zk)) and the new 50% rule under the Code on Wages would normally apply — meaning the higher of (Basic + DA) or 50% of CTC. But the rule does not explicitly cross-reference. Worth a clarification from the Ministry; assume the new wage definition until clarified.
Source: IR (Central) Rules, 2026 · Rule 37 · references s.83 of the Code
Chapter XII · Rule 38

Offences & Composition

First-time offenders can compound offences by paying a notified amount instead of facing prosecution. Forms XV (notice + application) handle the procedure; the compounding officer is notified by the Centre.

Rule 38 HR CFO
Compounding of offence — Form XV notice; 15 days to apply; can be done before or after prosecution starts.
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The compounding officer issues a notice in Form XV via the Ministry portal. The accused has 15 days from receipt to fill Part III of Form XV and electronically deposit the compounding amount.

Three scenarios:

  • Before prosecution: compounding ⇒ no complaint will be filed
  • During s.85 proceedings: compounding officer informs the s.85 officer ⇒ proceedings closed
  • After prosecution has started: accused applies to the court; with the court's permission the offence is compounded; the compounding officer informs the court; court discharges the accused
Form XV
Confidence flagThe amount of the compounding fee is set under section 89 of the IR Code itself, not under these rules. These rules govern only the procedure. Check section 89 for the actual schedule of compounding amounts.
Source: IR (Central) Rules, 2026 · Rule 38 · references s.89 of the Code
Chapter XIII · Rules 39–50

Miscellaneous — Protected Workers, Enquiries, Records

The longest chapter by rule count. Twelve rules covering protected workers, complaints by aggrieved employees, authorisation of representatives, the conduct of enquiries, witness expenses, record maintenance, and the appointment and remuneration of Commissioners by the Tribunal.

Rule 39 HR You
Protected workers — annual list by 30 April; 12-month recognition period.
+

Each registered trade union connected with the establishment must communicate to the employer, before 30 April every year, the names and addresses of officers it wants recognised as protected workers. Employer has 15 days to recognise (subject to the maximum number permitted under s.90(4)) and communicate back the list. Recognition is for 12 months. Where multiple unions exist and the total exceeds the cap, the maximum is distributed in proportion to membership. Disputes go to the Deputy/Regional/Assistant CLC (Central), whose decision is final.

Source: IR (Central) Rules, 2026 · Rule 39 · references s.90 of the Code
Rules 40–43 You HR
Aggrieved employee complaint (Form XVI) and rules of representation.
+

Section 91 of the Code lets an aggrieved employee complain about unfair labour practices and other contraventions. The complaint:

  • Must be in Form XVI, electronically or by speed post
  • Accompanied by enough copies for each respondent
  • Must be verified by the employee or their authorised representative before the conciliation officer / arbitrator / Tribunal / National Industrial Tribunal

If the worker is not a member of any trade union, they can authorise (in Form VI) any office-bearer of any trade union connected with the industry, or another worker, to represent them. Same logic applies if an employer is not a member of any employers' association — they can be represented by an officer of any associated employers' body. A party is bound by the acts of its representative.

Form VI
Form XVI
Source: IR (Central) Rules, 2026 · Rules 40–43 · references s.91 of the Code
Rule 44 HR
Enquiry procedure — affidavit-based; cross-examination; written statements; documents.
+

For complaints under sections 86(3), (5), (7)–(11) of the Code, the conciliation officer/Tribunal follows a structured procedure: receipt of complaint → service on respondents → written statements → affidavit evidence → cross-examination → final order. Adjournments are limited and reasoned.

Source: IR (Central) Rules, 2026 · Rule 44 · references s.86 of the Code
Rules 45–47 All
Witness expenses, communications by publication, and record maintenance.
+

Witnesses receive expenses at the same rate they would for attending a civil court. Where a person cannot be found for service of any message or document, publication in a newspaper or on the Ministry portal is deemed effective service. Records, registers, forms, notices, and display boards must be maintained electronically wherever feasible and physically otherwise.

Source: IR (Central) Rules, 2026 · Rules 45–47
Rules 48–50 HR
Tribunal-appointed Commissioner — for valuing benefits in money terms.
+

For computing the money value of a benefit under s.59(2) — e.g., where a worker is owed something of monetary value but not a cash payment — the Tribunal can appoint a Commissioner. The Tribunal, after consulting the parties, estimates probable expenses and fixes the Commissioner's fee. The Commissioner submits a report by the date specified in the appointment order. The fee is recoverable from one or both parties as the Tribunal directs.

Source: IR (Central) Rules, 2026 · Rules 48–50 · references s.59 of the Code
Subscriber Tool · Compliance Checklist

A 24-item compliance checklist — printable, audit-ready.

We've built a printable compliance checklist for HR & legal teams: 12 always-on items (committees, registers, recognition cycles) and 12 event-triggered items (retrenchment, lock-out, change-of-conditions, compounding). Free for Friday Digest subscribers.

24
Compliance items
12 + 12
Always-on / event-triggered
PDF
Print to share with team
Preview · 3 of 24 items
20+ workers: Grievance Redressal Committee constituted. Rule 6
300+ workers: Standing Orders certified or Model SO adopted; displayed at main entrance. Rules 10, 16
Re-Skilling Fund deposit: 15 days' last-drawn wages within 10 days of retrenchment. Rule 37
+ 21 more items, with progress tracking and one-click print…
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Reference · Forms Index

All sixteen forms — what, when, who.

Every form attached to the IR (Central) Rules, 2026, with its triggering rule, who files it, and when. Field-by-field walkthroughs available for Forms I, II, III, and IV — read the form deep-dive →

Form What it is Filed by When
Form IMemorandum of Settlement · employer–worker settlement, in conciliation or otherwiseEmployer + worker repsOn reaching settlement
Form IIApplication to Tribunal · where conciliation has failedAggrieved partyWithin 90 days of conciliation report
Form IIIRegister of Standing Orders · maintained by certifying officerCertifying officerContinuous · electronic
Form IVNotice of change in service conditions (Third Schedule matters)EmployerBefore effecting change
Form VReserved · used in older drafts; check schedule
Form VIAuthorisation for representation in proceedings (non-union worker)Aggrieved workerBefore representation
Form VIIRecovery of dues · application by worker / groupWorker / groupWhen dues unpaid
Form VIIIRecovery of dues · by authorised person / heir / assigneeAuthorised person / heirWhen dues unpaid
Form IXComputation of money value of a benefit (to Tribunal)Worker / groupTribunal disposes within 3 months
Form XComputation of money value of a benefit · by heir / assigneeHeir / assigneeAfter worker's death
Form XIStrike notice · 14-day mandatory advanceUnion secretary or 5 elected workers14 days before strike
Form XIILock-out notice · 14-day mandatory advanceEmployer14 days before lock-out
Form XIIIRetrenchment / closure notice (Chapter IX · general)EmployerWithin 3 days (retrenchment) / 60 days before (closure)
Form XIVLay-off / retrenchment / closure application (Chapter X · 300+ rule, prior approval)EmployerPre-event (90 days before closure)
Form XVCompounding notice + application (Parts I–III)Compounding officer + accused15 days from receipt of notice
Form XVIAggrieved-employee complaint (s.91 of the Code)Aggrieved employeeWhen unfair labour practice / contravention occurs
Reference · Numbers That Matter

Twelve numbers worth memorising.

Every threshold, every timeline, every percentage that matters under these rules — at a glance.

Grievance Committee
20 workers
Trigger threshold for mandatory committee.
Standing Orders
300 workers
Threshold for own certified SO; below = Model SO applies.
Sole negotiating union (single)
30%
If only one union exists, automatic recognition above this share.
Sole negotiating union (multiple)
51%
Required where multiple unions compete.
Negotiating council seat
20%
Membership floor where no union has 51%.
Re-Skilling Fund deposit
15 days
Last-drawn wages, by employer, within 10 days of retrenchment.
Re-Skilling Fund disbursal
45 days
CLC must credit retrenched worker's account within this period.
Grievance resolution
30 days
Committee must resolve; failure → escalation right.
Strike / lock-out notice
14 days
Mandatory advance notice (under s.62 of the Code).
Closure notice (Ch. IX)
60 days
Form XIII — general (no prior approval needed).
Closure permission (Ch. X)
90 days
Form XIV — for 300+ establishments, prior approval mandatory.
Compounding window
15 days
Time to file Form XV Part III + deposit amount.
FAQ · Plain English Answers

Eight questions everyone is asking.

No jargon. No hedging. The most common questions, answered the way you would explain them to a friend.

Do these rules apply to my company today?+

These are Central Rules. They apply directly to establishments where the Central Government is the appropriate government — railways, ports, mines, oil fields, banking, insurance, and any establishment owned/controlled by the Centre. For everyone else (most private companies), the State Rules of your state apply. Several states have already notified — Karnataka, Maharashtra, Kerala — and most others are at draft stage. Practically, your state's rules will closely mirror these Central Rules, because state rules cannot contradict the substantive provisions of the Code.

Bottom line: read these as your reference framework. Watch your state's gazette for the operative version.

What is the single most important new financial obligation?+

The Worker Re-Skilling Fund (Rule 37). Every retrenchment now triggers an additional 15 days of last-drawn wages — credited to a Government-held fund within 10 days, paid out to the worker within 45 days. This is on top of statutory retrenchment compensation (15 days × years of service under s.70(b)) and notice-period pay. For a workforce reduction of 100 workers averaging ₹50,000 last-drawn, that's roughly ₹25 lakh of additional contribution beyond what was payable under the old Industrial Disputes Act.

If I have 290 workers, am I exempt from prior approval to retrench?+

Generally yes — Chapter X of the Code (which requires prior Government approval) applies to establishments employing 300 or more workers on average per working day in the preceding 12 months. At 290, Chapter IX applies — meaning you can retrench (with statutory compensation, notice, and Re-Skilling Fund deposit) without prior permission. But if your average crosses 300, you flip categories. Track your rolling 12-month average headcount carefully — and remember the Code permits the appropriate Government to specify a different threshold by notification.

Are fixed-term employees covered by these rules?+

Yes — fixed-term employees are workers under the Code. The substantive entitlements (parity of wages, gratuity after one year, statutory benefits) come from the Code itself and the SS Code. These IR rules govern the procedural side: settlement memos, grievance redressal, standing orders, and the Re-Skilling Fund all apply.

Confidence flag: the rules don't separately address whether a fixed-term contract that simply ends on its specified date counts as "retrenchment" for Re-Skilling Fund purposes. The IR Code's definition of retrenchment under s.2(zh) excludes contract-end terminations — so the Re-Skilling Fund deposit likely doesn't apply to natural FTE expiry. We will update this answer when the Ministry clarifies.

Can I send a strike or retrenchment notice by WhatsApp?+

Almost certainly no — even though "electronically" is broadly defined. The rules consistently say "by email" or "uploading on the official portal" or "by speed post." WhatsApp is neither email nor portal upload, and there's no jurisprudence yet treating it as a valid mode of statutory service. Use email and speed post as a belt-and-braces approach until the Ministry or courts clarify.

What if my company does not have a recognised trade union?+

Several rules cover this directly. For Works Committee and Grievance Committee, workers elect representatives among themselves; the employer can use an electronic platform for the election. For settlements, five worker representatives authorised at a meeting can sign on workers' behalf. For aggrieved-worker representation in proceedings, any other worker or office-bearer of any trade union connected with the industry can be authorised in Form VI. For strike notices, five elected worker representatives can sign in lieu of a union secretary. The procedural framework anticipates non-unionised workforces.

If I am retrenched, when do I see the Re-Skilling Fund money?+

Within 45 days from the date of your retrenchment. The mechanics: your employer must transfer 15 days of your last-drawn wages to the Fund within 10 days; the Chief Labour Commissioner's office (or its regional/deputy/assistant office) then has up to 45 days from your retrenchment date to credit it directly to your bank account. The amount is meant to be used for re-skilling — but the rules don't impose a specific use-restriction or audit mechanism on the worker. Keep your bank account active and your account details up to date with your employer at the time of retrenchment.

Are these rules the final word? Can they change?+

These are the final Central Rules — not draft. They are operative law. But:

State rules are still being notified. Operational portals (the Ministry's designated portal for grievances, conciliation reports, lay-off applications) are still being rolled out. Substantive provisions of the Code itself — the new pension scheme under the SS Code, the cap on protected workers under s.90(4) — are subject to separate notifications. Expect operational tweaks via clarifications and FAQs over the next 6–12 months.

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This page covers the Industrial Relations (Central) Rules, 2026, notified vide GSR 342(E) on 8 May 2026 by the Ministry of Labour and Employment, Government of India. State Rules under the IR Code may vary. Information here is editorial in nature, not legal advice. For decisions with legal consequence, consult a qualified labour law practitioner or the gazette text directly. TLC — The Labour Codes is an independent publication and is not affiliated with the Government of India.